Thoughts 10.17.18

Big rally yesterday.  Nobody should be surprised that we are giving some of that back on the open.  Right now there are a lot of trapped holders of stock that bought into the market these last six months  at much higher prices.  Some of these holders will be looking to get out at any opportunity they have as they get close to being even on those purchases.  This could take more than one day to work through.  

Still fact that we found support over the last couple of days and then bounced is encouraging.  Will we get a retest of last week's lows?  Only time will tell.

Good economic news:  The Job Openings and Labor Turnover Survey {JOLTS} showed a record 7.14 million job opening in August.  That is the highest number ever recorded for this survey who's data goes back to the early 2000s.

Concerning economic news:  Mortgage applications collapse to a 19-year low.  This should surprise nobody as the double whammy of higher interest rates and the further recognition by homeowners that not all of their mortgage interest and property taxes may be deductible is really taking a bite out of the housing industry.  The multiplier effect of housing shouldn't be underestimated and this is something we need to watch carefully going forward.    

So far in early going the major indices have given up on average about a third of a percent.  If this holds today call this a win.  Long way to go though.

Back tomorrow.